North South University

MGT: 489

Case 2

Prepared for:

Bobby Hajjaj (BHj) North South University
Prepared by:

ID 072 276 030 072 277 030 072 356 030 072 434 030 072 578 030 072 600 030

NAME Sohag Chakma M. Raashed Mahmud Sreezon Rahman Nahian Kabir Ashraf Uddin Ahmed Refath Islam

Section: 03 Date of Submission: 19th June, 2011
Word Count: 978

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4. to remain profitable and maintain its market leadership it is high time that cirque should develop future competency. Since its beginning. 2|Page . innovator of category in live entertainment. When cirque started. was initiated from a group of street performers. 5. It was an excellent mix of artistic creativity and commercial success 2. Due to the failure of ‘The Battersea Project’.President and childhood friend Daniel Guthier has created more pressure for Guy Laliberte. The resignation of Co. Key Issues 1. company’s brand image was massively affected. 3. Hence. it has travelled around the world transporting the audience to an alternate dimension of reality. and acrobatics that mesmerized the people around the globe. It has a unique hybrid of music. there was almost no competition however recently they are facing competition locally and internationally. Their innovative shows performed by world-class performers and their commitment towards highest quality built a strong brand name that became their core competencies and competitive advantage over its competitors. Increasing number of competitors create pressure on company. dance.Background Cirque du Soleil. Cirque du Soleil started their journey with a unique idea of creating universal appeal. Attracting adequate number of artists to maintain the exclusivity of the company.

and universal acceptance. To maintain this quality it needs a good cost which justifies the higher ticket prices. talented performers. Core Competen cy 1. we find out three core competencies. people all over the world like their shows. when we talk about VRIN model.Analysis Competitive Advantage: The requirements of competitive advantage are one that is Valuable. Inimitable. Those are strong brand image. Rare. But. only brand image will consider as competitive advantage. When it comes to market scope Cirque focuses on the broad segment. As a result. Competitive Positioning: Cirque is famous for its commitment to the best quality show and most superior services by following a differentiation strategy. They do not customize their shows for different geographical location rather they have a standard form of shows. and Non Substitutable. 3|Page . Here.

Their excellent blend of art and business has made them a strong brand which adds value.Cost Leadership Competitive Advantage Differentia tion Niche Broad Market Scope 2. Such business process has added value to their success over their competitors. Moreover. Their performers are recruited from different events like Olympic which have provided them with flawless teamwork and effort. insurance regulation and tax laws from country to country. 3. dance. Resource Based View: Cirque du Soleil has the universal appeal with no language. X-factor: • Valuable: Cirque Du Soleil was the pioneer of a unique live entertainment which blends opera. theatre and circus with live music. they have decentralized HR operations so that they can cope with different employment policies. 4|Page . Hence their brand image is higher than any other competitor.

5|Page . they can come up with seasonal discounts or other special offer. However. Some new competitors offer similar shows at lower ticket price.• Scarcity: The Company has a very good number of skilled performers which is not a very good reason to be different or to get a competitive edge over others. Due to Cirque’s high cost structure it is not feasible for them to permanently cut down their ticket price. Although Cirque has five touring shows that perform all over the world. By doing so they will be able to retain more customers and thus sustain profits. However since the nature of the business is such that competitors can easily copy the concepts. The Game Theory also suggests that they should offer discount since it is the dominant strategy for them. Product Development: Cirque’s legendary success has resulted from its ability to repackage traditional circus in a exclusive manner. Cirque can also capture Asian market by arranging more permanent shows. Market Development: Third step should be to focus on market development. its permanent shows are only concentrated in Las Vegas and Florida. Since Cirque does not compromise with its quality. • Imitation: The show contents can be easily copied. Cirque should move towards more creative and sophisticated version of their shows. their ticket price is justified. Good performers can be found by training up or hiring. Strategies Discount & Seasonal Offers: Cirque’s main source of revenue is its ticket selling. so Cirque will have to be competitive in terms of pricing.

V. they should not proceed with the project.Diversification: Cirque generates 80% of its profit from ticket selling activities and the rest 20% comes from merchandising. unless cirque has enough capital to invest. So it must find new ways to compete with its rivals with its artistic and unique creativity along with strong brand and commercial establishment. Recommendations • Although Cirque has a strong HR department. studio. Hence. it does not have well organized financial and marketing department. Cirque should reduce its dependency on ticket selling revenue by diversifying their business. Brand the performers: Cirque can make their some performers famous worldwide so that the audience will go to watch their performance and it will give them a feel of watching some celebrities. Using all these resources it can easily diversify. If Cirque wants to have full creative control over the project. 6|Page . shop. Cirque has its own headquarter. shows in a regular basis and other media coverage more focused on the performers rather than the Cirque. it should hire talented financial and marketing persons in order to manage its financial and marketing operations efficiently. and training facility. they also need to invest in the project because no investor will be willing to give away full creative control. This is possible by telecasting some T. Blue Ocean Strategy: Cirque started the business with a blue ocean strategy to operate in a completely different industry where no one is directly competing with them. However. recently they are facing a number of local and international competitions. So. • For the time being they should close down their Battersea Project.